With pressures mounting on operators from all sides, the added disruption of diners failing to show up for booked slots is one everyone would prefer to avoid. Here Nick Telson, Co-founder of DesignMyNight, discusses the no-show phenomenon, looking at what can be done to tackle the most recent thorn in the industries side.

The UK hospitality industry is facing pressure from all sides, what with Brexit, the National Living Wage and increases in food prices, business rates and rents. That’s not to mention people shortages across front and back-of-house.

Recent news has also focused on established chains and indeed independent operators having to restructure and close sites, and now the industry is facing another crisis: the rise in no-shows. Restaurants are reporting an increase in weekly no-shows of up to 20% in some establishments, costing businesses thousands of pounds in lost income.

How much more of a battering can the hospitality industry take and what do operators need to do to stay afloat against these mounting challenges?

The industry is indeed facing a lot of pressure. However, I believe operators who “do it well” are still thriving. When I say “it”, I mean no matter how advanced technology becomes, we must remember we are still in the business of hospitality and the customer experience must remain number-one.

It’s the welcoming smile, the front-of-house team member who understands the menu and allergies, and the ‘nothing is too much trouble’ attitude, which should underpin our industry. I’m a firm believer that great service and an even greater experience can, and does make up for average food and drinks.

For chains, I think consistency of experience, offering and quality is vital. Customers want to know, wherever they choose to dine, that the experience will always be up to a certain level. For me, both of these aspects outweigh the promotions/offers game so many operators fall into.

Research shows, if a customer has an excellent dining experience on their first visit, there is still only a 40% chance they’ll come back. After their second excellent visit, the chances of a repeat visit are still only at 42%. However, after the third excellent visit, that likelihood rockets to 70%.

So… the learnings here for operators are, know your customer, know their loyalty to your brand and ensure they have a wonderful experience, no matter how small the gestures.

To give you an example, Duncan Garrood, the new CEO of Bill’s, shared this recently: One of our waiters learned a customer’s daughter had just come from a long hospital stay and was celebrating by having lunch with us, as she started her home convalescence. She had a great meal and then our waiter arranged a get well soon gift basket for her to take home, with some biscuits for her dog.

The family and especially the daughter won’t forget this. It is this level of service and attention to detail which will elevate one operator above another, ensuring they remain relevant in a saturated marketplace.

Would you recommend that operators name and shame no-shows?

I’m not convinced that naming and shaming no-shows will solve the problem. It’s a short term win, which in the moment, may help to relieve frustrations and anger - however, won’t solve the underlying problem. Operators need to be using technology, whilst educating customers about the ramifications to the industry.

How can operators and indeed the wider industry educate consumers on the impact of no-shows on restaurants?

Operators and service providers need to work together as one community to highlight the impact of no-shows to the press and through social media channels. Restaurants, no matter how large, are businesses which employ a tonne of people who rely on that employment for their livelihood. It’s very simple, multiple no-shows puts jobs at risk. Customers tip waiting staff because they appreciate the job they do and know they often rely on tips to maintain a liveable wage. No-shows are the opposite of this, putting jobs at risk. These are the stories we need to be putting out to the media and through social. These are the stories which resonate with consumers – not angry posts naming and shaming.

Would you recommend that operators request a deposit on booking to deal with the issue of no-shows, bearing in mind, that some have tried and then experienced a decline in bookings?

Operators need to manage this with discretion. Does an operator need to take card authorisation for a group of two diners on a Monday? Probably not. I’d recommend tailoring it to the busier service periods. So for example, deploying it on bookings of six or over from Monday to Wednesday, groups of four or more on a Thursday and across all bookings on a Friday and Saturday. A card-authentication is a lot “softer” than a deposit; which will alleviate the concern of a drop in bookings.

Do you think operators are doing enough to deal with the issue of no-shows?

Operators are trying with the tools they have to deal with the issue of no-shows. However, a great deal of this is manual and hugely labour intensive, with hosts/managers having to call customers to double-check they’re coming in, or for card details. With the 100s of other tasks front of house need to deliver every day, the reality is checks will at times get missed. To alleviate this for operators, our system texts customers before they are due, and they simply reply YES or NO to confirm their booking. We’ve seen great success with this because we know customers don’t mind a quick SMS.

I would also recommend that operators mark customers as no-shows in their booking system. This allows them to keep a list of regular offenders and send them a friendly, but informative email or they have the option to stop them from making future bookings. We are also currently exploring Uber-style client ratings, where operators can star-rate customers based on no-shows, behaviour etc. This would put the power firmly back into the hands of the operator, allowing them to act as they see fit.

Do you agree customers should be able to cancel their booking up to 24/48 hours before without being hit with a cancellation policy?

I think there needs to be a transition period of changing the customer’s mindset. After all, it’s better for them to cancel, than not show up at all. An operator can always try to fill the space or re-market through a waitlist or social media channels. Sometimes there will be a legitimate reason for a customer to cancel, which the majority of operators do get. However, if an operator is busy and booked out well in advance, then as long as the cancellation policy is clear and upfront - not hidden in loads of T&Cs, then customers tend to be fine with it. Transparency is key here.

It has been said that operators should be doing what airlines, stadia and theatres have been doing for decades and sell tickets for tables. How do you feel about this?

Our Collins Booking System has the ability to take a payment at the point of booking, which is essentially a ‘ticket’, and for the right operator with demand, this works. However, my view is a booking plus card authentication is more suitable then selling a physical ticket. If an operator is hosting an actual event, perhaps a steak and wine night, then tickets would be appropriate to prevent no-shows and secure the income upfront, but I wouldn’t recommend tickets for individual dinner reservations.

Interestingly, the bar industry has been taking payment upfront for a long time for pre-booked business, and it seems more acceptable in this sector. Theoretically, there is no reason why restaurants couldn’t follow suit, tiering the cost like airlines. So, for more in-demand or high footfall days of the week, operators could command more premium booking conditions.

Are there any marketing tools operators can adopt to stop the scourge of no-shows?

Operators should be educating their customers via email, through their websites and social media channels - appealing to their better nature, whilst explaining the huge impact on the industry and the people within it.

Human nature is not something we can change but the no-show battle is one we can win.